Considering a Home Improvement Project?

It is so tempting to make changes to your home. No matter how nice your home may be, there are still things that could be changed. Millions of homeonwers have taken advantage of home equity loans in the past few years. They have remodeled their homes in many ways.

But many of them find that they are unable to recoup all of the money they put into their improvements. Not all home improvements are seen the same by buyers, so how do you know which improvements bring the most bang for your buck?

Home improvement recoups vary according to the region. They can even vary by the region. In most areas, you can expect to recoup less of your investment in a slow real estate market than in a hotter real estate market. If home prices aren't appreciating rapidly, you may find that your improvement costs may not be totally regained.

One of the most popular projects, finishing out a basement, sees the lowest rate of return -- at less than 50% of your costs. So, if you spend $12,000 to refinish your basement, you can expect your home's value to increase at resale by less than $6,000.

Kitchen remodeling and bathroom additions are often the best improvements for recouping your expenses. They will often pay you back 75% to 90% of your costs. Swimming pools will usually get you only 10% of your cost.

Whirlpool tubs, fireplaces and decks all fair just as poorly as pools. The fact is, what is important to you may not be important to the buyer. And after all, the things are no longer new, they are used.

The top improvements for recouperating your expenses include:

• Kitchen improvements
• Adding or remodeling a bathroom
• Adding a room
• Landscaping
• Adding a bedroom
• Adding a garage

I understand that you can't always decide on home improvements based on the financial side. You may simply need more space. Or you may really want that whirlpool tub.

Just try to stay within reason. Remember, it never pays to be the largest or most expensive house in the neighborhood. It will be difficult to sell your place if it costs much more than those around you. The value of your home will be affected by those around you. So if you make your home larger or more expensive than the ones next door, you probably will lose out on your recovery of costs.

Consider your future plans for your home closely when deciding what home improvements to make. If you are planning on selling in the next five years, you may recover only a small percentage of the money you put into your home. And you definately don't want to owe more on it than you can sell it for.

If you are planning on making improvements in order to increase the selling price, make sure you do some research. Talk with realtors in your area, builders and other industry professionals about the areas you should concentrate your efforts on.

Martin Lukac represents http://www.RateEmpire.com, an Internet consumer banking marketplace. RateEmpire.com is a destination site of personal finance, banking, investing, taxes, debt management and mortgage rates. RateEmpire.com provides mortgage guides and financial rates and information. RateEmpire.com also operates a financial portal #1 American Financial, found at http://www.1AmericanFinancial.com and San Diego loan portal http://www.LendingSanDiego.com